fy17 operating plan and budget - icann · 2 – planning and budget overview 9 3 – icann...

I C A N N | Five-Year Operating Plan First Annual Update | Draft for Public Comment March 2016 1

FY17 Operating Plan and Budget June 2016

I C A N N | FY17 Operating Plan and Budget | June 2016

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Table of Contents Summary of Changes 5

1 – Introduction 7

2 – Planning and Budget Overview 9

3 – ICANN Operations 11

3.1 – Resource Utilization ____________________________________________________________________________________________ 11 3.2 – Support and Revenue ___________________________________________________________________________________________ 13 3.3 – Operating and Capital Expenses ___________________________________________________________________________________ 16 3.4 – Multiyear Projects (formerly Initiatives) _____________________________________________________________________________ 19 3.5 – Risks and Opportunities _________________________________________________________________________________________ 21

4 – Overview of the IANA Stewardship Transition and Implementation (including PTI) 22

4.1 – Overview of Transition and Implementation (including PTI) _____________________________________________________________ 22 4.2 – Focus on Post-Transition IANA (PTI) Implementation __________________________________________________________________ 26 4.3 – Focus on the IANA Functions Operating Plan and Budget _______________________________________________________________ 29

5 – New gTLD Program 32

5.1 – New gTLD Financial Summary ____________________________________________________________________________________ 32 5.2 – New gTLD Program Multiyear View _________________________________________________________________________________ 33 5.3 – New gTLD – Variance Analysis _____________________________________________________________________________________ 35 5.4 – New gTLD – Operating Expenses Variance Analysis ____________________________________________________________________ 37


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6 – Total ICANN Overview 38

6.1 – FY17 Resource Utilization ________________________________________________________________________________________ 38 6.2 – Headcount – Three Year Overview _________________________________________________________________________________ 39

7 – FY17 Operating Plan and Budget – Description 40

7.1 – Management System ____________________________________________________________________________________________ 40

7.2 – Objective 1: Evolve and Further Globalize ICANN 42

7.3 – 1.1 Further Globalize and Regionalize ICANN Functions ________________________________________________________________ 42 7.4 – 1.2 Bring ICANN to the World by Creating a Balanced and Proactive Approach to Regional Engagement with Stakeholders __________ 44 7.5 – 1.3 Evolve Policy Development and Governance Processes, Structures and Meetings to be More Accountable, Inclusive, Efficient, Effective and Responsive ____________________________________________________________________________________________________ 45

7.6 – Objective 2: Support a Healthy, Stable, and Resilient Unique Identifier Ecosystem 47

7.7 – 2.1 Foster and Coordinate a Healthy, Secure, Stable, and Resilient Identifier Ecosystem ______________________________________ 47 7.8 – 2.2 Proactively Plan for Changes in the Use of Unique Identifiers and Develop Technology Roadmaps to Help Guide ICANN Activities __ 49 7.9 – 2.3 Support the Evolution of Domain Name Marketplace to be Robust, Stable and Trusted ____________________________________ 51

7.10 – Objective 3: Advance Organizational, Technological and Operational Excellence 54

7.11 – 3.1 Ensure ICANN’s Long-Term Financial Accountability, Stability and Sustainability ________________________________________ 54 7.12 – 3.2 Ensure Structured Coordination of ICANN’s Technical Resources _____________________________________________________ 56 7.13 – 3.3 Develop a Globally Diverse Culture of Knowledge and Expertise Available to ICANN’s Board, Staff, and Stakeholders ___________ 57

7.14 – Objective 4: Promote ICANN’s Role and Multistakeholder Approach 58

7.15 – 4.1 Encourage Engagement with the Existing Internet Governance Ecosystem at National, Regional and International Levels _______ 58 7.16 – 4.2 Clarify the Role of Governments in ICANN and Work with them to Strengthen their Commitment to Supporting the Global Internet Ecosystem ________________________________________________________________________________________________________ 59


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7.17 – 4.3 Participate in the Evolution of a Global, Trusted, Inclusive Multistakeholder Internet Governance Ecosystem that Addresses Internet Issues ____________________________________________________________________________________________________________ 61 7.18 – 4.4 Promote Role Clarity and Establish Mechanisms to Increase Trust within the Ecosystem Rooted in the Public Interest __________ 62

7.19 – Objective 5: Develop and Implement a Global Public Interest Framework Bounded by ICANN’s Mission 64

7.20 – 5.1 Act as a Steward of the Public Interest __________________________________________________________________________ 64 7.21 – 5.2 Promote Ethics, Transparency and Accountability Across the ICANN Community ________________________________________ 66 7.22 – 5.3 Empower Current and New Stakeholders to Fully Participate in ICANN Activities ________________________________________ 68

Appendix 70

A – FY17 Budget by Project ___________________________________________________________________________________________ 70 B – FY17 IANA Operations by Activity ____________________________________________________________________________________ 71 C – Registrar Fees ___________________________________________________________________________________________________ 80

I C A N N | FY17 Operating Plan and Budget | June 2016 5

Summary of Changes This section shows changes made to the final budget based on input received from the Public Comment period.

Section/Topic Public Comments/Rationale for Change

Actions

3.5 – Risks and Opportunities Updated analysis Summary updated 4 – IANA Stewardship Transition Implementation Project Cost Support Team

analysis reflected Activities and costs detailed. Update resulted in a reallocation of some staff personnel costs (Communications and Legal teams) from baseline operations to the IANA Transition Project.

Portfolio 1.1.2, GSE Executive team coordination and administration

Original title was not understood Updated title

Portfolio 1.1.3 Language Services Languages supported and services provided not well understood

Updated the description

Portfolio 1.3.2, Reinforce Stakeholder Effectiveness, Collaboration and Communication Capabilities

Additional community travel support

Budget changed to reflect additional support

Portfolio 2.1.4, Global Domains Division (GDD) Operations

Description not understood Updated the description

Portfolio 2.1.5, Global Customer Support, including Registrant Engagement

Description not understood Updated the description and merged in what was 2.3.2

Portfolio 2.1.6, Product Management Description not understood Updated the description Portfolio 2.2.1, WHOIS Core Function/Service and Improvements

Description the same as 2.3.1 Updated the description

Portfolio 2.3.1, 2.3.1 Registration Directory Services Analysis and Development

Description the same as 2.2.1 Updated the description

Portfolio 2.3.2 GDD Registrant Engagement and Support (as was)

Merged into 2.1.5 This portfolio merged into 2.1.5 but the number has been retained as a placeholder to minimize reader confusion

Portfolio 2.3.5, New gTLD Program Description not understood Updated the description Portfolio 3.1.5, Support Operations Description not understood Updated the description KPI for Goal 3.2 Scope of top-tier services not

understood KPI wording updated to clarify scope


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Portfolio 4.2.2, Engagement with Governments and IGOs


Portfolio 5.2.2, Organizational Reviews


Portfolio 5.3.1, Development and Public Responsibility Tools


Portfolio 5.3.2, Development and Public Responsibility Programs


Portfolio 5.3.3, Development and Public Responsibility Collaborations


Portfolio 5.3.4, Development and Public Responsibility New Program Development



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1 – Introduction This document contains ICANN’s FY17 Operating Plan and Budget, which was submitted for public comment as required by ICANN’s Bylaws, and in accordance with ICANN’s public comment policy. ICANN published a report on the public comments received on 6 June 2016. Enabling the engagement of stakeholders in the planning process of ICANN, through accessible information and effective interaction, is a fundamental part of ICANN’s multistakeholder model. The publishing of the draft version of this Operating Plan and Budget for public comment was a key element of the transparency and community engagement in ICANN's planning process. ICANN welcomes and recognizes the past, present and future engagement of all stakeholders into the ICANN’s planning process, whether relative to the strategic plan, operating plan, budget, or on-going operational and financial updates. This document provides the details of ICANN’s activities for its fiscal year 2017 (FY17) that runs from 1 July 2016 to 30 June 2017. Where useful, comparative information for FY16 is provided, using actual and forecast information for this fiscal year, in progress at the time of this document’s publication. ICANN published its draft FY17 Operating Plan and Budget two weeks earlier than last year, and nine weeks earlier than the previous year, in a constant effort to allow more time for review and interaction. This is intended to further enhance the understanding and transparency of its activities, and ultimately its accountability in the management of funds in the public interest. This early publication supported a two-month Public Comment period. 12 people and organizations submitted detailed input, totaling over 150 individual comments. Changes were made based on the comments received and these are described in the Summary of Changes section above. The Operating Plan and Budget includes: Highlights of ICANN Operations (excluding the new gTLD Program) Overview of the IANA Stewardship Transition and implementation (including Post Transition IANA) Highlights of the new gTLD Program An overview of ICANN’s FY17 Budget, combining ICANN Operations and the new gTLD Program The detailed Operating Plan predefined in the management system: Planned portfolios of activities to support the achievement of the goals and objectives described ICANN’s Strategic Plan with detailed descriptions. An Appendix linking to list of projects, for each portfolio, with the project-level budgeted costs by category

The Supporting Organization (SO) and Advisory Committee (AC) additional budget requests were evaluated and approved by the Board 15 May 2016. The list of the special request decisions adopted can be found on the Finance Community Wiki.

https://www.icann.org/resources/pages/rules-procedures-2014-03-17-en

https://www.icann.org/en/system/files/files/report-comments-op-budget-fy17-five-year-06jun16-en.pdf

https://community.icann.org/


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This year’s Operating Plan and Budget includes data on all projects to be carried out during FY17, and displays all costs categories for each project. Each project is also mapped to one of the five objectives of the ICANN Strategic Plan for fiscal years 2016-2020, through the hierarchy of portfolios and goals, making the rationale for each project and activity clear and transparent. References and Notes

1. The ICANN Community includes all ICANN’s stakeholders —including its Supporting Organizations, Advisory Committees, Nominating Committee, Board of Directors, and Staff. ICANN’s multistakeholder model, therefore, defines its community.

2. Definition of terms can be found in the ICANN online glossary. 3. ICANN will continue to evolve and refine the metrics / Key Performance Indicators (KPIs) over time as we build out a Dashboard.


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2 – Planning and Budget Overview The graphic below depicts the five-year planning cycle (FY16-FY20), at a high level. The planning process consists of the ICANN Strategic Plan for fiscal years 2016-2020 and the Five-Year Operating Plan, which provide input and a basis for the annual planning process.


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The structure of the budget data that follows in the rest of this document is displayed below.


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3 – ICANN Operations This section provides an overview of the ICANN Operations cash expenses for baseline and multiyear projects.

3.1 – Resource Utilization

ICANN OPERATIONS by Cost Category Increase/(Decrease)

in Millions, USD BaselineMultiyear Projects Total Baseline

Multiyear Projects Total Baseline

Multiyear Projects Total %

TOTAL SUPPORT AND REVENUE $132.4 - $132.4 $120.8 - $120.8 $11.6 - $11.6 9.6%

Personnel 61.9 1.1 63.0 51.7 2.3 54.0 10.2 (1.2) 9.0 16.7%Travel & Meetings 15.7 1.7 17.4 15.4 0.6 16.0 0.3 1.1 1.4 8.8%Professional Services 21.5 1.7 23.2 19.2 1.5 20.7 2.3 0.2 2.5 12.1%Administration 16.6 0.4 17.0 15.8 0.2 15.9 0.8 0.3 1.1 6.6%Community Support Requests (a) 0.6 - 0.6 - - - 0.6 - 0.6 100.0%Contingency 5.0 - 5.0 1.2 - 1.2 3.8 - 3.8 313.2%Capital 5.3 1.0 6.3 6.0 0.8 6.8 (0.7) 0.2 (0.5) -7.7%

TOTAL CASH EXPENSES (b) $126.5 5.9 132.4 $109.3 5.3 114.6 17.2 0.6 17.8 15.5%

EXCESS/(DEFICIT) $5.9 ($5.9) - $11.5 ($5.3) $6.2 (5.6) (0.6) (6.2) -100.0%

AVERAGE HEADCOUNT (FTE) (c) 357.9 7.1 365.0 301.8 14.9 316.7 56.1 (7.8) 48.3 15.3%

FY17 Adopted Budget FY16 Forecast

(a) FY16 Community Support Requests have been allocated to the expense categories based on the nature of the request. (b) Excludes bad debt and depreciation expenses.(c) FTE: Full-time staff equivalent


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ICANN Operations by Function FY17 Adopted Budget FY16 Forecast Increase/ (Decrease)

In Millions, USD BaselineMultiyear Projects Total

Avg.Hdct

EOYHdct Baseline

Multiyear Projects Total

Avg.Hdct

EOYHdct Baseline

Multiyear Projects Total %

Avg.Hdct

EOYHdct

Support and Revenue $132.4 $132.4 $120.8 $120.8 $11.6 $11.6 9.6%

Compliance & Safeguards $5.4 $0.0 $5.4 26.0 27 $5.3 $0.0 $5.3 24.0 25 $0.1 $0.0 $0.1 1.8% 2.0 2

GDD: DNS, IANA, Ops 20.4 0.0 20.4 80.4 80 18.1 0.0 18.1 65.6 74 2.3 0.0 2.3 12.9% 14.8 7

CTO 6.0 0.0 6.0 13.9 14 5.1 0.0 5.1 12.5 15 0.9 0.0 0.9 18.2% 1.4 (1)

Strat. Initiatives & Reviews 3.8 1.7 5.5 10.1 10 3.0 0.0 3.0 5.5 8 0.8 1.7 2.5 83.9% 4.6 3

Strategic Communications 9.0 0.0 9.0 22.0 22 8.1 0.0 8.1 20.7 22 0.9 0.0 0.9 11.1% 1.3 0

GSE and Meetings Ops. 14.9 0.6 15.5 44.0 44 14.6 0.0 14.6 40.0 41 0.3 0.6 0.9 5.8% 4.0 3

Gov Engagement 2.9 0.0 2.9 7.0 7 2.6 0.0 2.6 6.9 7 0.2 0.0 0.2 8.1% 0.1 0

SO/AC Policy and Eng. 10.5 0.0 10.5 30.0 30 9.4 0.3 9.7 28.5 30 1.1 (0.3) 0.8 8.2% 1.5 -

Public Responsibility 2.9 0.8 3.6 8.0 8 0.3 2.5 2.8 7.0 8 2.5 (1.7) 0.8 28.8% 1.0 -

Governance support 11.6 0.0 11.6 21.7 22 10.1 0.0 10.1 16.4 19 1.5 0.0 1.5 14.6% 5.4 3

Operations 16.7 0.4 17.1 45.0 45 16.3 0.0 16.3 36.7 41 0.4 0.4 0.8 5.0% 8.3 4

IT & Cyber Security 21.1 2.5 23.6 60.1 60 20.1 2.5 22.6 48.9 54 1.0 0.0 1.0 4.4% 11.1 6

Executive & Ombudsman 2.4 0.0 2.4 4.0 4 2.8 0.0 2.8 4.0 4 (0.4) 0.0 (0.4) -15.8% - -

New gTLD Allocation (5.1) 0.0 (5.1) (7.8) 0.0 (7.8) - - 2.7 0.0 2.7 -34.6% - -

Corporate (0.9) 0.0 (0.9) (7.3) (7) 0.0 0.0 0.0 - - (0.9) 0.0 (0.9) 100.0% (7.3) (7)

Contingency 5.0 0.0 5.0 1.2 0.0 1.2 - - 3.8 0.0 3.8 313.2% - -

Total Baseline Opex (Cash) $126.5 $5.9 $132.4 365.0 366 $109.3 $5.3 $114.6 316.7 347 $17.2 $0.6 $17.8 15.5% 48.3 18

Excess/(Deficit) $5.9 ($5.9) $0.0 $11.5 ($5.3) $6.2

“Corporate” represents staff attrition.


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3.2 – Support and Revenue This section provides an overview of ICANN’s revenue, starting with the assumptions that are underlying to the FY17 estimates. The best estimate corresponds to the FY17 revenue included in the FY 17 budget. The high and low estimates provide for a sensitivity analysis of some of the revenue items and are the result of variations of the best estimate.

Revenue Type Best estimate High estimate Low Estimate

Faster growth at 3.2% Slower growth at 1.2%

New TLDs Fixed Fees

Transactions based fee Same as Best estimate

Legacy TLDs Transaction-based fee

Assumes growth of registration volume of 2.2% as per historical average.

1,083 TLDs delegated as of July 1, 2016, 156 TLDs delegated during FY17 ; 1,239 delegated by June 30, 2017. Estimated delegation date per TLD based on application status and estimated timeline to proceed to delegation (early adopters/average/late adopters)

New registrations estimated using the per-TLD average number of registrations per month since delegation (average registrations during month 1, month 2,…)An average registration renewal rate of 50% was applied to the registrations occurring during the same month 1 year before, except for TLDs that provided free registrations, where renewal rate was estimated at 25%.

FY17 delegations lower than Baseline by 15%Assumes faster

delegation in Q1 FY17

Average registration renewal rate at 35% (instead of 50% for Best estimate)


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Revenue Type Best estimate High estimate Low Estimate

Application fees Same as Best estimate Same as Best estimate

Accreditation fees Same as Best estimate

Same as Best estimate Same as Best estimate

Registrar Accreditation

Assumes 40 new applicants (low end of historical trend), times existing 1-time application fee

New gTLD Program Application fees Revenue

Portion of application fees recognized in revenue ratably based on evaluation expense incurred vs total evaluation expenses forecasted

No sensitivity analysis

The best estimate includes an anticipated reduction in the volume of accredited Registrars in FY17 to the levels of FY15. This conservatively decreases the number of registrars to 1,595

Constant total of $3.4mPer-registrar variable fee

Assumes reduction in accreditations


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The following table provides the revenues of ICANN by source and type, comparing for each the best estimate for the FY17 budgeted year and for the FY16 current year.

H ig h L ow

Legacy gTLDRegistry - transaction fees 48.2 46.9 1.4 3% 48.6 47.6 Registrar - transaction fees 29.1 28.1 1.0 3% 29.4 28.7

Sub-total $77.4 $75.0 $2.3 3% $78.0 $76.2 -

New gTLD - Registry - fixed fees 30.2 21.5 8.7 41% 30.2 28.7 Registry - transaction fees 5.8 2.8 2.9 104% 5.9 5.5 Registrar - transaction fees 5.5 3.0 2.6 86% 5.6 5.3

Sub-total $41.5 $27.3 $14.2 52% $41.7 $39.5

Registrars accreditationApplication fees 0.1 2.6 (2.5) -95% 0.1 0.1 Accreditation fees 6.3 8.8 (2.4) -28% 10.0 2.8 Per-Registrar Variable Fees 3.4 3.4 - 0% 3.4 3.4

Sub-total $9.9 $14.8 ($4.9) -33% $13.6 $6.3

ContributionsRIR 0.8 0.8 - 0% 0.8 0.8 ccTLD 2.1 2.1 - 0% 2.1 2.1 Meeting Sponsorships/other 0.8 0.8 - 0% 0.8 0.8

Sub-total $3.7 $3.7 - 0% $3.7 $3.7

ICANN Ops Revenue $132.4 $120.8 $11.6 10% $137.0 $125.7

In Millions, USD FY16 Forecast

FY17 Best Estimate

F Y 17 E s timates+ Increase/ - Decrease %


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3.3 – Operating and Capital Expenses

In Millions, USD

FY17 Baseline* 120 121.5+0.1

FY16 New Baseline* 114.6

FY16 Baseline* 108.1

IT Infra-structure

strengthening & Salesforce

Development

Public Responsibility

Reduction of New gTLD

Allocations

Full year impact of FY16 hires; compensation

increases, net of personnel attrition**

FY17 Hirings IANA/PTI costs

increase

Other

*Excludes contingency

100

** Excludes impact of FY16 hires for IT Infrastructure strengthening & Salesforce Development and Public Reposibility multiyear projects which are separately reflected in those categories above.

Baseline increase resulting from Initiatives

+3.0

+1.0

+2.6

+2.7

+1.3

+6%

+2.7


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The ICANN Operations Baseline operating and capital expenses budget (excluding multiyear projects and IANA Stewardship Transition costs) is $121.5 million. This represents a $13.4 million increase from $108.1 million in FY16. Baseline increase resulting from FY16 multiyear projects: The portion of IT infrastructure strengthening, Salesforce.com development and Public

Responsibility costs that have become ongoing baseline work in FY17. Reduction of new gTLD allocations: The allocation of ICANN Operations shared services to the new gTLD Program is decreasing due to fewer ICANN

resources allocated to the program. Full year impact of people hired in FY16: Increase in personnel costs due to 45 employees hired in FY16 working a full year in FY17 versus a partial year

in FY16, plus personnel costs increases, less attrition. Impact of people hired in FY17: average 18.5 Full Time Equivalents (FTEs) IANA/PTI costs increase: Incremental costs for the formation of a separate legal entity for Post-Transition IANA Other: Limited growth in all other areas (for example, inflationary increases).


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KMF: An ISO term. A protected enclosure for a room and cryptographic equipment and its contents where cryptographic elements reside. This is used to manage the Root DNS Key Signing Key RZMS: The Root Zone Management System is use by the Root Zone Management Partners to maintain the Root DNS Zone

In Millions, USD

Capital Purchase TypeFY17

Adopted Budget

Description

Development & Testing $1.6

Computer Software 1.6 Development and testing outsourcing (Zensar and others)

On-going replacements & improvements 2.1

Computer Equipment 1.0 SHI/Apple/PC Connection/Eplus/TIG, Juniper.

Computer Software & Equipment 1.0 Enterprise Resource Planning (ERP) -- Oracle ERP

Furniture & Fixtures 0.0 Office furniture replacements

Machinery & Equipment (non-computer) 0.1 FY17 IANA KMF Maintenance

Real Estate 1.0

Furniture & Fixtures 0.1 Los Angeles Office Construction

Leasehold Improvements 0.9 Los Angeles Office Construction

Strategic 1.6

Computer Software 0.1 Salesforce upgrade

Computer Software & Equipment 1.5 RZMS Development; ongoing security & infrastructure support, etc.

Grand Total $6.3


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3.4 – Multiyear Projects (formerly Initiatives) ICANN carries out projects relating to significant activities not in ICANN’s normal/core scope or, while core, projects that relate to activities exceptional in their frequency, level of spend, or impact. These projects may be completed upon achievement of the intended outcome, or lead to defining future ongoing activities, which will add to the scope of core operations. In FY15 and FY16, ICANN funded from its Reserve Fund, the IANA Stewardship Transition initiative, as well as public responsibility and IT infrastructure projects. The funding of the IANA Stewardship Transition project was the subject of requested input from the community as part of the public comment process on the draft version of the FY17 Operating Plan and Budget. For FY17, all but the IANA Stewardship Transition project are suggested to be funded from ICANN’s annual revenues. As the funding by annual revenue of multiyear projects, whose financial burden varies year on year, may continue to be a challenge, ICANN will work on developing funding guidelines for these projects. These will aim at allowing ICANN to carry out its activities in a stable, secure and sustainable manner. Also, ICANN has been working on expanding the governing documentation of its Reserve Fund. Community engagement will be organized on these topics as comprehensive solutions become available.


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In Millions, USD

Multiyear ProjectFY17 Adopted

BudgetDescription

Enterprise Resource Planning (ERP) $2.4The introduction of a new Oracle-based Enterprise Resource Planning system that will replace many of our Finance, Procurement and HR systems. We anticipate having this core system in place during November 2016.

Reviews 1.7Planning and conducting reviews, and implementing improvements related to mandated reviews of ICANN commitments and structures exceeding a baseline level of activity.

Public Responsibility 0.8Supports Education and Academic Outreach; Next Generation; and Participation in Global Internet Cooperation and Development.

ICANN Contribution to IPv6 Uptake 0.6

ICANN must engage alongside its I* peers (particularly the RIRs and ISOC) in promoting IPv6 now that IPv4 is almost fully allocated. This initiative takes a two-pronged approach to assessing the situation and addressing it where necessary. One stream of work will be internal and focus on ICANN’s own service infrastructure and the other will look at contractual parties and ccTLD Operators. This is anticipated to be a three-year effort, although this operating plan document only covers FY17.

Salesforce Redevelopment 0.5 Redevelopment of the GDD registry and applicant portal to resolve security vulnerabilities and build a sound platform for future growth.

Total $5.9


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3.5 – Risks and Opportunities This section outlines the risks and opportunities to the FY17 Budget and provides the potential impact of the risk or opportunity on the FY17 Budget assumptions as either lower or high revenue or cost.


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4 – Overview of the IANA Stewardship Transition and Implementation (including PTI) 4.1 – Overview of Transition and Implementation (including PTI) The global multistakeholder community has engaged in a process to develop recommendations for transitioning the stewardship of the IANA Functions since NTIA’s announcement in March of 2014. This community, comprises of: individuals operational communities ICANN Supporting Organizations (SOs) ICANN Advisory Committees (ACs) businesses and trade associations civil society groups governments and others from all regions of the world. These recommendations are contained in the IANA Stewardship Transition Coordination Group (ICG) proposal (the Proposal). In implementing the recommendations of the Proposal, ICANN is guided by its mission to ensure the stable and secure operation of the Internet’s unique identifier systems and by its duty to ensure the stability of ICANN’s operations while respecting the IANA contract obligations. There are three tracks of work. Planning for the new IANA stewardship arrangements is based on an expectation that the contract between NTIA and ICANN for the IANA Functions will expire on of 30 September 2016. ICANN is developing plans to implement new IANA stewardship arrangements resulting from the Proposal by the IANA Stewardship Transition Coordination Group (ICG) and new ICANN accountability mechanisms resulting from the Cross Community Working Group on Enhancing ICANN Accountability (CCWG-Accountability). The three tracks are: Track 1: Root Zone Management

https://www.ntia.doc.gov/press-release/2014/ntia-announces-intent-transition-key-internet-domain-name-functions


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Contains the work related to changes to the Root Zone Management System (RZMS) to remove NTIA's Root Zone Administrator (RZA) role with authorization process, and execution of an agreement between ICANN and Verisign for Verisign to serve as the Root Zone Maintainer (RZM). Track 2: Stewardship Transition Contains work related to developing relationship documentations with the three operational communities, including Service Level Agreements, creation of a Post-Transition IANA (PTI) entity, establishment of a Customer Standing Committee (CSC) and a Root Zone Evolution Review Committee (RZERC), and operationalizing the IANA customer service escalation mechanisms and SLAs. Track 3: Accountability Enhancements (Workstream 1) Contains work related to implementing enhancements to ICANN’s Independent Review and Reconsideration Request processes, updating ICANN’s governance documents, and operationalizing new community powers defined by the CCWG-Accountability. Workstream 2 The CCWG-Accountability will, following transmission of the Workstream 1 proposal, focus work on issues identified that are not related to the IANA Stewardship Transition but are issues the community notes should be addressed as part of ICANN's broader continued accountability enhancement work. For FY17, all the activities described above (tracks 1 to 3 and Workstream 2) require support from ICANN staff, for: organization of calls notes and follow up meetings organization and support constituent travel support professional services and advice (including legal advice). IANA Stewardship Transition expenses of $8.8 million have been included in the FY17 budgeted expenses. The funding of these expenses is designated to come from the Reserve Fund as a temporary measure, until a community discussion is conducted early in FY17 to determine the appropriate and final funding of these expenses.


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Amounts in USD thousands (000's)

Staff Travel & Meetings

Telecom & Language Services

Legal Services Total

(including contractor support)

US Gov't Affairs

(Lobbying)

Other (excluding contractor support)

IRP Phase 2 -$ -$ -$ 800$ -$ 119$ 919$

Accountability WS2 (Proposal Development,Bylaws Drafting and Implementation)

808$ 354$ 201$ 1,400$ -$ 225$ 2,988$

Transition Implementation 1,713$ 153$ 629$ 1,130$ -$ 115$ 3,739$

General Project Activities 869$ 45$ -$ -$ 250$ -$ 1,164$

Total 3,389$ 552$ 830$ 3,330$ 250$ 459$ 8,810$

IANA Stewardship Transition FY17 Budget

Total

Other Professional Services

The IANA Stewardship Transition budget is comprised of the following types of costs: Staff This includes staff and contractors that take their assignments and direction from the leadership of the individual WGs and staff supporting ICANN’s implementation work. The staff costs are tracked monthly by position/employee using a percentage of time allocated to the transition projects. These percentages are reviewed by each department manager. Community and Staff Travel and Meetings This includes all travel costs for funded members and participants as well as staff and contractors performing WG support and ICANN’s implementation work. The budget for funded members and participants includes travel and meeting costs for 20 members for an additional dedicated day of meeting of a cross community working group at each of the three ICANN meetings. Telecom and Language Servcices This includes all costs associated with supporting the WGs for Adobe rooms, teleconferences, dial-outs, recording and transcription of calls as well as interpretation, scribing and translation services.


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Legal Services Costs for independent legal advice obtained on request. Lobbying and Other Professional Services This includes all costs associated with external services and contractors in service of the transition which are not covered by Work Group support. These fees consist of firms and contractors for services such as Education/Engagement/Advice, Root Zone Management evaluation and Graphics/media. Lobbying costs are for pre transition lobbying with the US government and have been broken out for clarity.


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4.2 – Focus on Post-Transition IANA (PTI) Implementation In its proposal to the IANA Stewardship Transition Coordination Group (ICG), the CWG-Stewardship recommends that a new, separate legal entity, Post-Transition IANA, be formed as an affiliate of ICANN to perform the naming function post transition. The following graph is an excerpt from the draft Implementation Plan currently under review, to depict the post-transition state:


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The structure of ICANN’s Operating Plan and Budget that results from the above future state, focusing on the PTI, is described below:


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4.3 – Focus on the IANA Functions Operating Plan and Budget The IANA Functions operating plan is defined by 13 activities, listed below, and further described in the Appendix.

The budget of the IANA Functions is defined by three sources of costs: Direct Costs (from both dedicated and shared resources) resulting from the 13 activities required to perform the IANA Functions. Direct costs of shared resources Support Services Allocations represent the cost of support functions allocated to IANA. The IANA Functions activities as defined above are then detailed or allocated by operational community, on the basis of estimated effort percentages, or through allocation keys. The portion of the IANA Functions related to Names as a result of this exercise, is included in the PTI entity, along with PTI specific costs.


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Below is a summarized view of the total IANA Functions costs, and its breakdown by operational community, and by the three sources of costs:

FY17 Budget IANA/PTIPTI

In millions, USD Names Numbers Protocol Parameters Total

Direct costs / Dedicated resources 2.1 0.5 1.1 3.7 Direct costs / Shared resources 1.2 0.3 0.6 2.0 Support Services Allocations 1.6 0.4 0.8 2.7 Total $4.9 $1.1 $2.4 $8.4

PTI Specific Costs 0.6

Total PTI Costs $9.0 The three sources of costs are further described below. Direct Costs of Dedicated Resources These costs cover direct and dedicated personnel (16 employees) and associated costs assigned to delivering the IANA Functions: registration and maintenance of protocol parameter registries; allocation of Internet numbers and the maintenance of the Internet number registries; validation and processing of root zone change requests as well as maintenance of the root zone registry; management of the .int and .arpa domains; and holder of the root zone key signing key for the security of the DNS root zone. Direct Costs of Shared Resources Within ICANN, departments other than the IANA department perform or participate to processes directly related to the delivery of the IANA Functions. The costs of the activities carried out by other departments to perform the IANA Functions were evaluated by each department's budget owner. They identified the direct external costs (professional services and infrastructure) and estimated the time spent by personnel from the department on the identified activities valued at the annual cost of each employee (base+benefits). The Appendix contains a full description of the activities carried out by those departments, which are summarized below:


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Request processing - IT Root Key Signing - IT, Registry technical Services, SSR, GSE IANA Website - IT, Legal, Web-admin Protection of data and systems - IT, Security, Legal Continuity and Contingency of service - IT Conflict of Interest assertions - IT, Legal Monthly reporting of performance - IT, Legal, Gov. Engagement Administrative support (shared with Compliance) Annual updates to Agreements - Legal The direct costs of shared resources also include an estimate for the depreciation costs of capital assets of $0.5 million. Allocated Support Function Costs The total costs of the allocated support functions after excluding the shared from those functions were divided by the total costs of operational functions to determine a percentage of support functions. This percentage was then applied to the total IANA Functions costs (both IANA department direct costs and shared resources direct costs as defined above), to determine a cost of support function allocated to delivering the IANA Functions. List of functions included in the Allocated support functions are: Executive Communications Operations (HR, Finance, Procurement, ERM, HR development, Operations Executive, Administrative / Real Estate) IT (cyber-security, admin, infrastructure, PMO, Staff facing solutions) Governance support (Legal, Board support, NomCom)


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5 – New gTLD Program 5.1 – New gTLD Financial Summary This section provides a financial summary of the New gTLD program.

ICANN (NgTLD) In Millions, USDFEBRUARY 2016

FULL PROGRAMCurrent

Estimate (Feb 2016)

Prior Estimate

(Mar 2015)Increase/

(Decrease)

Total Application Fees -$362.2 -$361.5Less: Total Refunds 52.7 55.9Net Application Fees -309.5 -305.6 3.8

ExpensesEvaluation Costs 120.5 123.9 -3.4Overheads 60.4 57.9 2.6Historical Development Costs 32.5 32.5 0.0Total Operating Expenses 213.4 214.2 -0.8

Others * 6.7 2.1 4.6

Remaining Balance -$89.3 -$89.3 $0.0

* Includes net investment gains/loss and actual risk costs.

FINANCIAL SUMMARY

VARIANCE EXPLANATIONS

Refunds -$3.2

Evaluation Costs -$3.4

Overhead $2.6

Others 4.6This includes actual risk costs of (+$5.0M) and net investment gains (-$0.4M). Future risk cost through the end of the program cannot be estimated.

Lower projected withdrawals 680 vs. 701 prior estimate and higher rate of withdrawals at 20%.

(ii) Pre-delegation - lower costs for legal due to internalization of contracting efforts (-$1.2M).

Allocation for ICANN staff support (+$3.7M); Other overhead (-$1.2M).

(i) Program Administration - lower costs due to lower number of EBERO providers (-$2.0M).

(ii) Extended Evaluation - Lower number of applications going through Extended Evaluation (-$0.1M).


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5.2 – New gTLD Program Multiyear View

FY12Actual

FY13Actual

FY14Actual

FY15Actual

FY16Forecast

FY17Forecast

FY18 & BeyondForecast

New gTLD Applicant Fees (166,846) (45,887) (71,366) (17,870) (36,855) (22,210) (361,034) ICANN Applicant Support Contributions - - - - - - - Auction (net of expenses) - - - - - - - Additional Fees - (540) (514) (69) - - (1,122) Refunds 8,936 12,080 18,448 4,048 9,190 - 52,703 Revenue (Net of Refunds) -$ (157,909)$ (34,347)$ (53,432)$ (13,891)$ (27,665)$ (22,210)$ (309,453)$

Initial Evaluation 3,172 57,491 3,650 23 - - - 64,336 Background Screening 27 2,682 933 18 - - - 3,661 Fin/Tech/Ops 2,194 44,301 1,756 - - - - 48,251 Geographic Names 134 4,284 562 4 - - - 4,984 String Similarity 453 2,949 694 - - - - 4,096 DNS Stability 198 1,535 (387) - - - - 1,346 Registry Services 167 1,739 91 - - - - 1,998

Extended Evaluation - - 760 383 - - - 1,143 Quality Control - 7,100 462 62 - - - 7,624 String Contentions - - 5 - - - - 5 Objection Processes 39 3,550 (1,064) (23) - - - 2,503 Pre-delegation - 124 4,003 3,072 5,634 2,700 2,100 17,633 Program Administration 450 2,347 4,800 3,911 3,869 5,720 6,203 27,300

gTLD Team 689 1,827 3,796 3,352 1,998 2,064 1,694 15,420 ICANN Staff Allocation 1,137 5,725 9,947 7,518 7,187 5,070 2,535 39,119 Other Overhead 107 228 1,991 2,034 463 626 458 5,907

Travel - 97 382 148 250 288 220 1,385 Depreciation - - 1,450 1,858 186 192 144 3,830 All Other 107 131 159 28 27 146 94 693

Total Operating Expenses 5,594$ 78,394$ 28,350$ 20,331$ 19,151$ 16,180$ 12,990$ 180,989$

Investment (Income)/Loss 811 (2,457) (896) (701) - - (2,702) Investment Management Fees - 14 213 279 120 - - 626 Historical Development Costs - 15,396 4,616 5,956 1,255 2,901 2,329 32,454 Risk Costs 281 1,068 1,012 2,466 3,982 - - 8,807

Total Other Income/(Expense) 281$ 17,289$ 3,384$ 7,804$ 5,197$ 2,901$ 2,329$ 39,185$

Change in Net Remaining Funds 5,874$ (62,227)$ (2,612)$ (25,297)$ 10,457$ (8,583)$ (6,891)$ (89,279)$

1,930 Applications

Statement of Activities by Fiscal Year Statement of Activities for Full Program

(Feb 2016)


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5.3 – New gTLD – Variance Analysis

EXPENSES REVENUECurrent Estimate

(Feb 2016)Prior Estimate

(Mar 2015)Increase/

(Decrease)Current Estimate

(Feb 2016)Prior Estimate

(Mar 2015)Increase/

(Decrease)

FY12 $5.6 $5.6 $0.0 $0.0 $0.0 $0.0FY13 93.8 93.8 0.0 -157.9 -157.9 0.0FY14 33.0 33.0 0.0 -34.3 -37.2 -2.8FY15 26.3 28.7 -2.4 -53.4 -40.2 13.3FY16 20.4 33.9 -13.5 -13.9 -49.5 -35.6FY17 19.1 14.3 4.8 -27.7 -20.8 6.8

FY18 & Beyond 15.3 5.0 10.3 -22.2 0.0 22.2Full Program * $213.4 $214.2 -$0.8 -$309.5 -$305.6 $3.8

* Excludes Actual Risk Costs.

Expenses * -$0.8

Revenue $3.8

* Detailed explanation of expenses provided in the following pages

Evaluation Processing (-$3.3M), Other Overhead (-$1.2M); offset by ICANN Staff Allocation (+$3.7M).

Decreased in projected withdrawals from 701 to 680 applications (+$3.2M) and lower rate of withdrawals at 35%; re-evaluation application processing costs (+$0.6M).

VARIANCE EXPLANATIONS


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5.4 – New gTLD – Operating Expenses Variance Analysis

Prior Estimate (Mar 2015)Operating Expenses $181.8

Variances - Increase/(Decrease):

Extended Evaluation -0.1 Lower number of applications going through extended evaluation.

Pre-Delegation-1.2

Lower professional services costs for contracting due to internalized contracting efforts by New gTLD team.

Program Administration -2.0 Lower number of EBERO providers: 4 current forecast versus 8 prior forecast.

ICANN Staff Allocation 3.7 Allocation for ICANN staff increased due to additional support needed for the New gTLD program.

Other Overhead -1.2 Depreciation (-$1.5M); All other expense for example, travel, etc. (+$.3M).

Current Estimate (Feb 2016) $181.0


6 – Total ICANN Overview 6.1 – FY17 Resource Utilization

TOTAL ICANNin Millions, USD SUPPORT AND REVENUE (a) $132.4 $27.7 - $160.1

Personnel 63.0 4.9 2.7 $70.6 Travel & Meetings 17.4 1.0 0.6 19.0 Professional Services 23.2 9.2 5.4 37.7 Administration 17.0 1.1 0.1 18.2 Community Support Requests (b) 0.6 - - 0.6 Contingency 5.0 - - 5.0 Capital 6.3 - 0.1 6.4

TOTAL CASH EXPENSES (c) 132.4 16.2 8.8 157.4 EXCESS/(DEFICIT) - 11.5 (8.8) 2.7

AVERAGE HEADCOUNT (FTE)(d) 365.0 11.0 10.8 386.8

(a) Excludes new gTLD auction proceeds.

(c) Excludes bad debt and depreciation expenses.(d) FTE: Full-time staff equivalent

ICANNOps

New gTLD Program

IANA Transition

TotalICANN

(b) FY16 Community Support Requests have been allocated to expense categories based on the nature of the request.


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6.2 – Headcount – Three Year Overview The headcount below represents staff employed on the last calendar day of each period.

276 286 285

310 316 322 324 342

361 375 375 376 376 20

22 23

12 10

10 10

10

10

11 11 11 11

200

250

300

350

400

Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17

ICANN Ops New gTLD

Headcount at end of period (includes heads for USG Transition)

I-----------------------------------Actual------------------------------------II-----Forecast-----II-----------------Budget----------------I

Total ICANNat 30 Jun 2017

387

FY16 Budgetopening

320

FY16 Budgetclosing

363


7 – FY17 Operating Plan and Budget – Description 7.1 – Management System The FY17 Operating Plan and Budget is informed by and aligns with the Five-Year Operating Plan’s phasing and its Key Performance Indicators. This allows us to map all activities and resources back to the five main Strategic Objectives developed by a community driven bottom up process. Five Objectives – these were reviewed and revised during the development of ICANN Strategic Plan for fiscal years 2016-2020, which was adopted by the

Board in October 2014. 16 Goals – owned by the CEO’s direct reports. Each goal has defined Key Success Factors to clarify what constitutes progress towards achieving a goal. 62 Portfolios – each goal contains a set of portfolios, which are groups of related projects. These also have defined success metrics. Over 340 Projects – Projects reflect ongoing work. Expenses are budgeted at the project level. A breakdown of all projects is linked from the Appendix.

The budgeted amounts in this document are inclusive of capital expenditures and initiatives. The budget amounts for each portfolio in the following sections are provided by cost category:

Meaning Abbreviation Personnel Pers Travel and Meetings T&M Administration Admin Capital Capital Full Time Equivalent FTE

Values are shows in millions, USD. The FTE refers to the full time staff equivalent dedicated to each portfolio.


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7.2 – Objective 1: Evolve and Further Globalize ICANN 7.3 – 1.1 Further Globalize and Regionalize ICANN Functions In FY17, we will focus on the following activities that work towards further globalizing and regionalizing ICANN functions:

1. Sustain implementation of regional communication strategies 2. Examine how hubs and engagement offices are supporting ICANN globalization 3. Language Services

We will measure our success in achieving this goal by: Meeting Services Scorecard, Engagement with community in major languages and scripts % of ICANN organizational functions globalized and available by region Stakeholder Engagement scorecard (previously an index) now belongs in Strategic Goal 1.2 beginning with FY17

Portfolios 1.1.1 – Raising Stakeholder Awareness of ICANN Worldwide Description: This portfolio pertains to how ICANN communicates with stakeholders around the world to help raise awareness of ICANN’s mission, its multistakeholder model and its work. This portfolio is grouped with 1.2.1 below. Metrics to measure ongoing communications activities include active social and traditional media monitoring and measurement, global newsletter open rates and reach of speaking engagements. 1.1.2 – GSE Executive team coordination and administration Description: This portfolio covers ICANN’s Global Stakeholder Engagement (GSE) prioritization and planning, across regions and functional areas. This portfolio is grouped closely with 1.2.2. The planning portfolio covers the organization of GSE and regionalization of ICANN functions and communications. 1.1.3 – Language Services Description: Make information about ICANN and its work accessible to those who speak languages other than English in ways that enhance participation in, and the effectiveness of, the multistakeholder model. To make ICANN more effective as a global organization, ICANN's translations are available in the six United Nations languages –Arabic, Chinese (Simplified), English, French, Russian and Spanish – where appropriate. Additional languages are also being supported to promote inclusion, this is done through two different means. These are by providing support to hub and engagements offices, such as Turkish for the Istanbul hub, and by promoting the Translation/Localization Kit Program where ICANN Language Services works with the community to translate


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into languages not supported within the UN set of languages. These languages include Japanese, Korean, and some others. ICANN Language Services also promotes the Teleconference Interpretation support in the six United Nations languages for all working group calls and any other teleconference call where the presence of support of availability of other languages may increase and facilitate participation.

Portfolios FTE Pers T&M Prof Svcs Admin Capital Total

1.1.1 Raising Stakeholder Awareness of ICANN Worldwide 14.6 2.4 0.2 0.8 0.2 0.0 3.6

1.1.2 Engagement Planning 4.5 0.9 0.1 0.0 0.1 0.0 1.2

1.1.3 Language Services 7.0 0.8 0.1 3.7 0.1 0.0 4.6

Total 26.1 $4.1 $0.4 $4.5 $0.4 $0.0 $9.3


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7.4 – 1.2 Bring ICANN to the World by Creating a Balanced and Proactive Approach to Regional Engagement with Stakeholders In FY17, we will focus on the following activities that work towards bringing ICANN to the world by creating a balanced and proactive approach to regional engagement with stakeholders:

1. Examine # of community participants in ICANN programs to enable measurement of the Stakeholder Journey 2. Broadcast and Engage with Global Stakeholders

We will measure our success in achieving this goal by: Global/regional engagement scorecard (this metric includes the regional Engagement Strategies and Fiscal Year work plans for each of the regions

and each regional scorecard is balanced against the ICANN objectives) Digital services metrics (to be phased in during FY17)

Portfolios 1.2.1 – Engage Stakeholders Regionally Description: This portfolio covers the mechanisms for delivering on ICANN’s regional and functional Engagement Strategies (including regional and functional area work plans, stakeholder engagement heat map) 1.2.2 – Broadcast and Engage with Global Stakeholders Description: Conceptualize and build a set of integrated digital tools to inform and enable engagement and collaboration within the ICANN Community


1.2.1 Engage Stakeholders Regionally 30.5 5.6 1.3 0.8 0.8 0.0 8.4

1.2.2 Broadcast and Engage with Global Stakeholders 5.8 1.3 0.1 0.2 0.1 0.0 1.7

Total 36.3 $6.8 $1.4 $1.0 $0.8 $0.0 $10.0


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7.5 – 1.3 Evolve Policy Development and Governance Processes, Structures and Meetings to be More Accountable, Inclusive, Efficient, Effective and Responsive For FY17, we continue to consolidate progress made towards the following activities that work towards evolving policy development and governance processes, structures and meetings to be more accountable, inclusive, efficient, effective and responsive :

The goal is to ensure that the policy development and decision-making processes are open, transparent, inclusive and legitimate. Ongoing efforts are directed at:

Greater inclusion by diverse global stakeholders More online tools and mechanisms for participation and SO/AC structures evolving to increase Community efficiencies and effectiveness in ICANN processes and activities

We will measure our success in achieving this goal by: # of participants in the policy development and governance processes by type, status and location Quality-of-service index (for example, “active” participants in policy development calls and meetings; # of publication subscribers/readers in

"print" and on web; # of public comments submitted in ICANN Public Forums; Twitter Subscribers and Tweets; and so on) Portfolios 1.3.1 – Support Policy Development, Policy Related and Advisory Activities Description: Optimize efficiency and effectiveness of community policy development and advice efforts 1.3.2 – Reinforce Stakeholder Effectiveness, Collaboration and Communication Capabilities Description: To optimize collaboration and engagement of ICANN SOs and ACs, and increase and measure the number of exchanges (meetings and correspondence) that take place between various SOs and ACs (and the Board as appropriate) as they consult and discuss strategic and policy issues/matters 1.3.3 – Evolving Multistakeholder Model Description: Planning and implementation of ICANN’s online education platform to: Support increased, informed, global involvement in ICANN;


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Plan for evolving ICANN’s multistakeholder model Facilitate the development and publication of academic research on the multi-stakeholder model for DNS coordination, Internet policy

development and governance


1.3.1 Support Policy Development, Policy Related and Advisory Activities 26.0 4.5 0.9 0.8 0.1 0.0 6.3

1.3.2 Reinforce Stakeholder Effectiveness, Collaboration and Communication Capabilities

6.0 0.9 3.1 0.1 0.0 0.0 4.1

1.3.3 Evolving Multistakeholder Model 1.2 0.2 0.0 0.2 0.0 0.0 0.4

Total 33.2 $5.6 $4.0 $1.1 $0.1 $0.0 $10.7


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7.6 – Objective 2: Support a Healthy, Stable, and Resilient Unique Identifier Ecosystem 7.7 – 2.1 Foster and Coordinate a Healthy, Secure, Stable, and Resilient Identifier Ecosystem In FY17, we intend to do the following to foster and coordinate a healthy, secure, stable, and resilient identifier ecosystem:

1. Deliver services to the ICANN Community according to service level targets 2. Monitor and manage service delivery against targets, identify opportunities for improvement and efficiency 3. Implement process improvements for increased operational efficiency and customer satisfaction 4. Implement system enhancements for increased operational efficiency and effectiveness.

We will measure our success in achieving this goal by: % of Service Level Targets met across multiple departments including but not limited to IANA, GDD Operations, and Global Customer Support

departments Portfolios 2.1.1 – IANA Department Operations Description: Operational responsibilities for maintaining registries for protocol parameters, IP numbers, Autonomous System Numbers, and root zone changes. Maintenance of relationship with Internet Engineering Task Force (IETF), Internet Architecture Board (IAB), five Regional Internet Registries (RIRs), and TLD operators 2.1.2 – IANA System Enhancements Description: Software enhancements, tool development, and other discrete projects to improve delivery of the IANA services 2.1.3 – Advice Registry Management


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Description: Development of processes and software used to track the acceptance, implementation, and resolution of advice provided to ICANN via Supporting Organizations, Advisory Committees, Review Teams, and others 2.1.4 – Global Domains Division (GDD) Operations Description: Projects related to the service implementation and ongoing delivery of services to contracted parties by the GDD. This includes reviewing and improving the way services are delivered 2.1.5 – Global Customer Support Description: Projects related to the development, implementation and ongoing operations of the ICANN Customer Service Center. This includes support, engagement and advocacy for the global registrant community 2.1.6 – Product Management Description: Projects and ongoing activities in support of the new gTLD Program. This include technical development work for service platforms 2.1.7 – Implementation of IANA Functions Stewardship Transition and Enhancing ICANN Accountability Description: Implementation of the community-developed proposals to transition the IANA Functions stewardship and enhance ICANN’s accountability


2.1.1 IANA Department Operations 18.1 3.0 0.2 0.7 0.4 0.1 4.4

2.1.2 IANA System Enhancements 1.2 0.3 0.0 0.0 0.0 0.0 0.3

2.1.3 Advice Registry Management 1.3 0.3 0.0 0.0 0.0 0.0 0.3

2.1.4 Global Domains Division (GDD) Operations 15.1 2.8 0.8 2.3 0.0 0.0 5.9

2.1.5 Global Customer Support 15.0 1.5 0.1 0.0 0.2 0.0 1.9

2.1.6 Product Management 2.0 0.4 0.0 0.0 0.0 0.0 0.5

2.1.7 Implementation of IANA Functions Stewardship Transition & Enhancing ICANN Accountability 1.0 0.3 0.0 0.9 0.1 0.1 1.4

Total 53.5 $8.5 $1.2 $3.9 $0.7 $0.2 $14.5


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7.8 – 2.2 Proactively Plan for Changes in the Use of Unique Identifiers and Develop Technology Roadmaps to Help Guide ICANN Activities In FY17, we will continue focusing on the activities that work towards proactively planning for changes in the use of unique identifiers and developing technology roadmaps to help guide ICANN activities:

1. Expanding the department to enhance logistical support for research and SSR-related projects. 2. Gain approval of Technology Roadmaps from the community. 3. Continue to expand and enhance relationships with protocol/technology development organizations. 4. Deploy automated systems to collect data and compute ratio of registered domain names to active IP addresses. 5. Deploy automated systems to collect data and compute ratio of registered domain names to Internet users regionally and globally. 6. Publish analyses of data collected, implications of changes in data over time, and other topics relevant to the use of unique identifiers and

evolution of identifier technologies 7. Document growth in ratios in developing regions

We will measure our success in achieving this goal by: Technical Reputation Index will measure ICANN's reputation for technical excellence in both the ICANN and broader Internet communities

Portfolios 2.2.1 – WHOIS Core Function/Service and Improvements Description: To promote trust and confidence in the Internet for all stakeholders, ICANN is committed to: Enforcing its current WHOIS policy Identifying improvements to the accuracy and reliability of the WHOIS system Implementing new GNSO consensus policies for WHOIS Addressing privacy and data protection concerns

2.2.2 – Identifier Evolution Description: Track and support the evolution of the Internet’s system of unique identifiers through venues such as the IETF, DNS-OARC, W3C, the RIRs, and other relevant bodies

https://www.ietf.org/

https://www.dns-oarc.net/

https://www.w3.org/

https://www.nro.net/about-the-nro/regional-internet-registries


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2.2.3 – Technical Experts Group Description: Support and enhance the Technical Expert Group, facilitating its activities related to exploration of technical issues and opportunities facing ICANN 2.2.4 – Security, Stability, and Resiliency of Internet Identifiers Description: Work to observe, assess and improve the security, stability, and resiliency (SSR) of the Internet’s Identifier systems in close collaboration with other ICANN departments and the community at large. This will be achieved through a range of activities including risk awareness and preparedness, measurement and analysis of identifier system behaviors or performance, and cooperative outreach that emphasizes coordination, capability building, and knowledge transfer


2.2.1 WHOIS Core Function/Service & Improvements 0.6 0.3 0.0 0.0 0.0 0.0 0.3

2.2.2 Identifier Evolution 2.0 0.6 0.0 0.2 0.1 0.0 1.0

2.2.3 Technical Experts Group 0.3 0.1 0.0 0.0 0.0 0.0 0.1

2.2.4 Security, Stability, and Resiliency of Internet Identifiers 10.6 2.8 0.3 0.4 0.1 0.1 3.8

Total 13.5 $3.8 $0.3 $0.6 $0.3 $0.2 $5.1


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7.9 – 2.3 Support the Evolution of Domain Name Marketplace to be Robust, Stable and Trusted In FY17, we will continue to support the development of a robust, stable and trusted domain marketplace by:

1. Ongoing monitoring of the Domain Name Marketplace Health Index 2. Improve multistakeholder satisfaction by reducing survey gap by at least 10% year over year 3. Show stable healthy year over year growth in the domain name industry 4. Finish the current round of the New gTLD Program and have agreement on the start of next round

We will measure our success in achieving this goal by: Domain Name Marketplace Health Index

Portfolios 2.3.1 – Registration Directory Services Analysis and Development Description: To promote trust and confidence in the Internet for all stakeholders, ICANN will evaluate whether there is a better system for providing information about gTLD domain names, consistent with applicable data protection and privacy laws to replace WHOIS, including: Conducting a Policy Development Process, to examine whether a new policy framework will be needed to support the next generation of

registration directory services Evaluating new Registration Directory Services technology Understanding the evolving data protection and privacy regulatory framework

2.3.2 – Placeholder Description: Projects in this portfolio were moved to 2.1.5 based on feedback received on the draft plans. This placeholder has been retained to minimize reader confusion regarding portfolio numbering 2.3.3 – GDD Technical Services Description: Projects to enhance systems, services and technical subject matter expertise related to a safe, secure, and reliable operation of the DNS 2.3.4 – Internationalized Domain Names Description: Support the introduction and universal acceptance and adoption of Internationalized Domain Names (IDNs)


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2.3.5 – New gTLD Program Description: Projects and ongoing activities in support of the new gTLD Program. Activities include: Program Operations to support New gTLD Contracting, as well as prior to delegation operations including Pre-Delegation Testing, Registry On-

boarding and Transition to Delegation. Module 5 of the AGB Operate and support Trademark Clearinghouse to enable New gTLD launch processes Project to Capture FY17 cost allocations from ICANN (Company 1) to New gTLD budget

2.3.6 – Outreach and Relationship Management with Existing and new Registry, Registrar Community Description: Create outreach and engagement strategies for registry and registrar operators to promote and cultivate a positive and constructive relationship among ICANN Staff, registries, registrars and other participants in the domain name industry value chain. Activities include having dedicated account managers, conducting workshops, webinars, and inter-sessional meetings, and attending ICANN meetings 2.3.7 – Domain Name Services Description: Domain Name Services ongoing operations and Industry Engagement 2.3.8 – Next gTLD Round Planning Description: Projects to design, plan and operationally prepare for the next application round of the new gTLD Program 2.3.9 – Universal Acceptance Description: ICANN support to the Internet community to enable all protocol valid domains - including ccTLDs, gTLDs, and IDNs - to work in applications regardless of the age or script. This work is intended to support the goals of the user choice, user confidence, and competition 2.3.10 – Registry Services Description: Projects related to managing the contracts, defining new services, and building a strong relationship with current and future registrar operators 2.3.11 – Registrar Services Description: Projects related to managing the contracts, defining new services, and building a strong relationship with current and future registry operators


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7.10 – Objective 3: Advance Organizational, Technological and Operational Excellence 7.11 – 3.1 Ensure ICANN’s Long-Term Financial Accountability, Stability and Sustainability In FY17, we will focus on the following activities that work towards ICANN’s long-term financial accountability, stability and sustainability:

1. Achieve financial roadmap annual targets (as designed in FY16) 2. Review operational processes and implement improvements. 3. Modify roadmap as needed and approved by Board, staff and stakeholders

We will measure our success in achieving this goal by:

Financial accountability, stability and sustainability indices (composite index of ratios and metrics) including but not limited to: Actual to budget Reserve Fund balance and utilization, and financial performance metrics Internal control performance indicators % project completion indices (with emphasis on major projects) % comparisons of actual to target succession plan readiness % comparisons of actual to target enterprise risk management roadmap achievements

On-time delivery index of the ICANN Planning process (includes: ICANN Five-Year Strategic Plan for FY16-FY20, Five-Year Operating Plan, Fiscal-Year Operating Plan and Budget, achievements and progress reporting)

Portfolios 3.1.1 – Raising Stakeholder Awareness of ICANN Worldwide Description: Review of the Five-Year Strategic and Operating Plan Implementation, and the development of FY18 Operating Plan and Budget 3.1.2 – Raising Stakeholder Awareness of ICANN Worldwide Description: Assessment, evaluation, reporting, and guidance to advance organizational, technological and operational excellence


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3.1.3 – Raising Stakeholder Awareness of ICANN Worldwide Description: All finance and procurement activities for the entire organization, in all locations. Includes the following functions: accounting (including accounts payable and billing), reporting and analysis, planning, tax, audit, procurement (PO processing, approval), sourcing 3.1.4 – Raising Stakeholder Awareness of ICANN Worldwide Description: Continue the focus on planning, assessing risk, evaluating mitigation, monitoring and progress reporting to minimize the effects of risks to the organization 3.1.5 – Raising Stakeholder Awareness of ICANN Worldwide Description: Various programs and projects that support functional operations. This includes: Coordination for the office of the President and CEO Tracking costs for ICANN Public Meetings Managing other conferences and events Developing the FY18 Operating Plan and Budget


3.1.1 Strategic and Operating Planning 3.4 0.7 0.3 0.0 0.0 0.0 1.1

3.1.2 Organizational Excellence and Intelligence 0.9 0.1 0.0 0.0 0.0 0.0 0.2

3.1.3 Finance and Procurement 17.3 2.8 0.0 0.2 1.3 0.0 4.4

3.1.4 Enterprise Risk Management 1.0 0.2 0.0 0.2 0.0 0.0 0.4

3.1.5 Support Operations 31.4 5.8 5.5 2.8 7.0 1.0 22.1

Total 53.9 $9.7 $5.8 $3.2 $8.3 $1.0 $28.2


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7.12 – 3.2 Ensure Structured Coordination of ICANN’s Technical Resources In FY17, we will focus on the following activities that work towards ensuring structured coordination of ICANN’s technical resources:

1. Measure and record a baseline for IT Services uptime by tier 2. Measure and compare metric for the IANA Functions against baseline for YoY improvement 3. Report on metric for on-time, on-budget IT projects delivery

We will measure our success in achieving this goal by: % of global IT infrastructure uptime (scaling from 99.9% in FY 2016 to 99.999 % in 2020 for ICANN community engagement and information web

services) Portfolios 3.2.1 – Cybersecurity Hardening and Control Description: All on-going infrastructure projects and services to maintain adequate performance of the systems supporting all ICANN operations 3.2.2 – IT Infrastructure and Service Scaling Description: Work towards a top-tier global IT infrastructure performing at 99.999% uptime and have ICANN recognized by the global community as having technical excellence and thought leadership 3.2.3 – Root Systems Operations Description: Facilitating the continued evolution of the root server system to ensure its ongoing security, stability, and resiliency as DNS technology and operations change over time: maintenance of relationships with the Root Server Operators, RSSAC, and related stakeholders


3.2.1 Cybersecurity Hardening and Control 17.7 2.6 0.0 0.4 4.6 0.7 8.3

3.2.2 IT Infrastructure and Service Scaling 32.6 5.6 0.4 1.6 1.2 3.7 12.7

3.2.3 Root Systems Operations 4.0 0.8 0.1 0.2 0.3 0.0 1.4

Total 54.3 $9.0 $0.6 $2.2 $6.1 $4.4 $22.4


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7.13 – 3.3 Develop a Globally Diverse Culture of Knowledge and Expertise Available to ICANN’s Board, Staff, and Stakeholders In FY17, we will focus on one core activity to work towards developing a globally diverse culture of knowledge and expertise available to ICANN’s Board, staff and stakeholders. We will measure our success in achieving this goal by: % of achievement in comparison to best practice benchmark metrics of global diverse culture, and knowledge levels of Board, staff and

stakeholders % of completion - actual to target implementation milestones of global development programs to advance the knowledge and expertise of

successors, key staff, all staff, Board and stakeholders Portfolios 3.3.1 – Talent Management Description: Establishing and developing the right mix of skills to accomplish critical business needs at both leadership and staff level. This includes focus on areas such as talent acquisition, leadership development, team effectiveness, learning and skill development and organizational change management 3.3.2 – ICANN Technical University Description: Providing a mechanism to improve the technical understanding of the technology ICANN coordinates


3.3.1 Talent Management 5.4 1.0 0.0 0.1 0.0 0.0 1.1

3.3.2 ICANN Technical University 0.3 0.1 0.0 0.0 0.0 0.0 0.1

Total 5.6 $1.1 $0.0 $0.1 $0.0 $0.0 $1.2


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7.14 – Objective 4: Promote ICANN’s Role and Multistakeholder Approach 7.15 – 4.1 Encourage Engagement with the Existing Internet Governance Ecosystem at National, Regional and International Levels In FY17, we will focus on the following activities that work towards encouraging engagement with the existing Internet Governance (IG) Ecosystem at national, regional and international levels:

1. Increase % participation rates documented as baseline established in FY16 2. Well-functioning and global acceptance by stakeholders of the post NTIA IANA Stewardship Transition, as reflected in feedback from stakeholders

We will measure our success in achieving this goal by: This is a compound index measuring the # of touch points between ICANN and national governments, regional governmental entities, and

Intergovernmental organizations, and International Organizations Measurement of quarterly engagement comparing to previous fiscal year quarterly engagement to show trend data

Portfolios 4.1.1 – Coordination of ICANN Participation in Internet Governance (IG) Description: This portfolio includes those projects that coordinate ICANN’s support for and participation in the Internet Governance Ecosystem as well as collaboration with other entities in the ecosystem on projects and initiatives of shared interest


4.1.1 Coordination of ICANN participation in Internet Governance 0.7 0.2 0.1 0.0 0.2 0.0 0.5

Total 0.7 $0.2 $0.1 $0.0 $0.2 $0.0 $0.5


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7.16 – 4.2 Clarify the Role of Governments in ICANN and Work with them to Strengthen their Commitment to Supporting the Global Internet Ecosystem In FY17, we will focus on the following activities that work towards clarifying the role of governments in ICANN and work with them to strengthen their commitment to supporting the global Internet ecosystem:

1. Increase the # of governmental entities actively participating in ICANN 2. Increase the # of trust agreements or frameworks for cooperation

We will measure our success in achieving this goal by: Increase # of GAC members (level of actual active participation and level of representation at ICANN meetings)

Portfolios 4.2.1 – Support GAC Engagement Description: This portfolio includes those projects supporting the activities of the Government Advisory Committee and those that facilitate outreach to increase participation in the work of the GAC 4.2.2 – Engagement with Governments and IGOs Description: This portfolio includes those projects supporting and coordinating outreach and engagement with governments and IGOs nationally, regionally and internationally to increase governments knowledge of and participation in the global Internet Governance ecosystem. Currently the IG-related events we anticipate in FY17 include: Regional and National IGF and IG events such as the European Dialogue on Internet Governance; Meissen Studentkrisse; SEEIG, SISS; APrIG; the

Africa Internet Summit and several of the African regional IGF; US IGF and others Global IGF in Guadalajara, Mexico December 2016 ITU Council meetings WG on Internet public policy Enhanced Cooperation WG of the CSTD reporting to ECOSOC WSIS Forum WTSA regional preparatory meetings Global WTSA meeting in Tunisia November 2016


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4.2.1 Support Governmental Advisory Committee (GAC) Engagement 0.2 0.1 0.0 0.0 0.0 0.0 0.14.2.2 Engagement with Governments and International Governmental Organizations (IGOs) 4.6 1.1 0.1 0.2 0.1 0.0 1.5

Total 4.7 $1.2 $0.1 $0.2 $0.1 $0.0 $1.6


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7.17 – 4.3 Participate in the Evolution of a Global, Trusted, Inclusive Multistakeholder Internet Governance Ecosystem that Addresses Internet Issues In FY17, we will focus on the following activities that work towards participating in the evolution of a global, trusted, inclusive multistakeholder Internet Governance Ecosystem that addresses Internet issues:

1. Increase in # of cooperation agreements with respective Internet organizations over baseline established in FY16 2. Identification of potential best practices among national and regional multistakeholder IG approaches to be highlighted in outreach work for

further adoption of multistakeholder model IG governance mechanisms We will measure our success in achieving this goal by: Participation in the evolution of the IG ecosystem

Portfolios 4.3.1 – Support Internet Governance (IG) Ecosystem Advancement Description: The portfolio encompasses the collaborative work within the Internet governance ecosystem to support evolution of multistakeholder distributed approaches


4.3.1 Support Internet Governance Ecosystem Advancement 1.7 0.6 0.1 0.0 0.0 0.0 0.7

Total 1.7 $0.6 $0.1 $0.0 $0.0 $0.0 $0.7


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7.18 – 4.4 Promote Role Clarity and Establish Mechanisms to Increase Trust within the Ecosystem Rooted in the Public Interest In FY17, we will focus on the following activities that work towards promoting role clarity and establish mechanisms to increase trust within the ecosystem rooted in the public interest:

1. Assess current practices and documentation 2. Identify and propose best practices 3. Propose measurements and benchmarks

We will measure our success in achieving this goal by:

Develop a framework that generates institutional confidence in ICANN and builds trust over time Assemble and refine Accountability-related KPIs as a means of measuring ICANN's accountability Implement means of measuring long-range progress.

Portfolios 4.4.1 – Contractual Compliance Functions Description: Day-to-day activities to ensure compliance by registrars and registries with their contractual obligations to ICANN and to report back to the community 4.4.2 – Contractual Compliance Initiatives and Improvements Description: This portfolio comprises a series of projects focused on the continuous improvement of contractual compliance operations and systems. This includes addressing contractual compliance interpretation issues and working with the ICANN stakeholders to define relevant metrics to improve transparency and reporting of contractual compliance 4.4.3 – Contractual Compliance and Safeguards Description: Projects relating to: (1) outreach to ICANN constituents regarding contractual compliance; (2) development of an analytic and nuanced approach to complex contractual compliance issues; and (3) cooperation and coordination on consumer safeguards that are beyond the scope of pure contract compliance


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4.4.4 – Strategic Initiatives Description: Consider and formulate Institutional Confidence Index (long-range) while assembling and refining Accountability-related KPIs, in line with the Accountability Framework proposed by One World Trust (short-range). This will include establishing benchmarks and targets as well as piloting the usefulness and relevance of KPIs


4.4.1 Contractual Compliance Functions 24.1 3.3 0.2 1.0 0.1 0.0 4.5

4.4.2 Contractual Compliance Initiatives & Improvements 1.0 0.2 0.0 0.1 0.0 0.0 0.3

4.4.3 Contractual Compliance and Safeguards 1.0 0.5 0.0 0.0 0.0 0.0 0.5

4.4.4 Strategic Initiatives 0.5 0.1 0.0 0.2 0.0 0.0 0.3

Total 26.5 $4.0 $0.2 $1.3 $0.1 $0.0 $5.6


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7.19 – Objective 5: Develop and Implement a Global Public Interest Framework Bounded by ICANN’s Mission 7.20 – 5.1 Act as a Steward of the Public Interest In FY17, we will focus on the following activities that work towards acting as a steward of the public interest:

1. To ascertain ICANN is acting within its global public interest mandate, ICANN will seek to measure and baseline the % of action by ICANN in decision making and how rationales are including the public interest assessments as part of decision making

We will measure our success in achieving this goal by: # of ICANN decisions and advice (Board, staff and stakeholders) that are rationalized based on common consensus-based definition(s) and

understandings of public interest within ICANN's remit Portfolios 5.1.1 – Legal Advisory Function Description: Provide legal advice to all functions at ICANN 5.2.1 – Public Interest Decision Making Description: Collaborative work with Community, Board, and Staff to work towards developing a consensus-based framework on understanding public interest within ICANN's remit, how to reflect public interest considerations in decision making across ICANN, and provide operational impact across all groups 5.3.1 – Legal Internal Support Description: Provide legal support to all functions at ICANN


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5.4.1 – Support ICANN Board Description: Provide staff support to the ICANN Board of Directors


5.1.1 Legal Advisory Function 2.9 0.8 0.0 0.0 0.0 0.0 0.8

5.1.2 Public Interest Decision Making 0.1 0.0 0.0 0.0 0.0 0.0 0.0

5.1.3 Legal Internal Support 8.5 2.0 0.1 2.1 0.1 0.0 4.3

5.1.4 Support ICANN Board 9.5 1.9 1.5 1.6 0.1 0.0 5.0

Total 21.0 $4.7 $1.6 $3.7 $0.1 $0.0 $10.2


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7.21 – 5.2 Promote Ethics, Transparency and Accountability Across the ICANN Community In FY17, we will focus on the following activities that work towards promoting ethics, transparency and accountability across the ICANN Community:

1. Measure against the baseline metrics developed in FY16 and show increase in acceptance and impact of Accountability and Ethical Framework 2. Continue to review for improvements and enhancements: measure and baseline the % of actions by ICANN in decision making and how rationales

are including the public interest assessments as part of decision making We will measure our success in achieving this goal by: Public interest framework index (for example, ICANN’s Documentary Information Disclosure Policy and correspondence posted on time,

compliance with the conflict of interest policy and compliance with the Board Code of Conduct) Develop a framework for increasing trust in ICANN’s fulfilment of its commitments through efficient and effective Reviews: Broad and diverse participation in ICANN Reviews Community engagement in using ICANN Reviews to drive continuous improvement in accountability, transparency and organizational

effectiveness (such as community participation in public comments pertaining to Reviews and other forms of engagement) Transmission of all Board approved proposals from the ICG and CCWG-Accountability to NTIA Completion of all community proposals that meet NTIA criteria for the IANA transfer for Chartering Organization approval

Portfolios 5.2.1 – Raising Stakeholder Awareness of ICANN Worldwide Description: Conduct mandated, regularly scheduled reviews of ICANN commitments and ICANN entities to support effectiveness and ongoing improvement in ICANN’s accountability and governance structures. Support effective community engagement and Board assessment and development of plans to maximize improvements to each entity and benefits to ICANN as a whole. Integrate outcomes into strategic planning efforts 5.2.2 – Raising Stakeholder Awareness of ICANN Worldwide Description: Conduct regularly scheduled reviews of ICANN entities to support their effectiveness and ongoing improvement; Support Board assessment and development of plans to maximize improvements to each entity and benefits to ICANN as a whole. This includes: Oversee timely and effective implementation of recommendations from the Second Accountability and Transparency Review (ATRT2) and

coordinate a predictable schedule of consistent implementation updates. Scheduled FY17 AoC Reviews include CCT, SSR2, WHOIS2 and ATRT3. AoC Reviews will be performed in accordance to ICANN's commitment in the AoC - see Board resolutions 2015.07.28.09–2015.07.28.14 and a letter to the NTIA from Fadi Chehade dated 28 January 2016.


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Conduct regularly scheduled reviews of ICANN entities to support their effectiveness and ongoing improvement; Support Board assessment and development of plans to maximize improvements to each entity and benefits to ICANN as a whole. Scheduled FY17 Organizational Reviews include At-Large Review 2, NomCom2 Review, and RSSAC2 Review.

5.2.3 – Conflicts of Interest and Organizational Ethics Description: Support compliance with ICANN's conflict of interest and organizational ethics policy and framework 5.2.4 – IANA Functions Stewardship Transition and Enhancing ICANN Accountability Description: (1) ICANN achieves its objectives in securing the IANA Stewardship Transition by supporting the three operational communities (names, numbers and protocol parameters) and achieving broad community support for a proposal that satisfies the four principles in NTIA transition proposal; and (2) the CCWG-Accountability is able to produce recommendations that provide assurance that ICANN is accountable in the absence of its historical contractual relationship with the U.S. Government. 5.2.5 – Raising Stakeholder Awareness of ICANN Worldwide Description: Supporting compliance with ICANN’s Accountability and Transparency Mechanisms framework


5.2.1 Affirmation of Commitments (AoC) Reviews 3.3 0.7 1.4 1.4 0.0 0.0 3.5

5.2.2 Organizational Reviews 2.1 0.3 0.0 0.0 0.0 0.0 0.3

5.2.3 Conflicts of Interest and Organizational Ethics 0.2 0.1 0.0 0.0 0.0 0.0 0.1

5.2.4 IANA Functions Stewardship Transition & Enhancing ICANN Accountability

9.8 2.5 0.5 5.1 0.0 0.6 8.6

5.2.5 Accountability and Transparency Mechanisms 1.1 0.3 0.0 0.1 0.1 0.0 0.4

Total 16.5 $3.7 $2.0 $6.6 $0.1 $0.6 $12.9


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7.22 – 5.3 Empower Current and New Stakeholders to Fully Participate in ICANN Activities In FY17, we will continue to build upon the work of FY16 that empowers current and new stakeholders to fully participate in and advance ICANN activities in the broader ecosystem. This work is achieved through specific and measurable development and public responsibility tools, programs, and collaborations along focus areas that strengthen the multistakeholder model. We will measure our success in achieving this goal by: Level of stakeholder participation for development and public responsibility programs, tools, and collaborations

Portfolios 5.3.1 – Development and Public Responsibility Tools Description: FY17 Development and Public Responsibility Tools overseen by DPRD team to broaden and support the multistakeholder model along focus areas. Tools include supporting and helping to facilitate remote participation, remote hubs, and the Online Learning Platform (OLP) ICANN Learn 5.3.2 – Development and Public Responsibility Programs Description: FY17 Development and Public Responsibility Programs overseen by DPRD team to broaden and support the multistakeholder model along focus areas. Programs includes to the Fellowship Program, the Newcomer Program, NextGen@ICANN, the Internship Framework, and the Leadership Training Program 5.3.3 – Development and Public Responsibility Collaborations Description: FY17 Development and Public Responsibility Collaborations overseen by DPRD team to broaden and support the multistakeholder model along focus areas. This includes SO/AC engagement work to identify gaps and barriers in ICANN participation, supporting academic outreach, and collaborative efforts that strengthen the ecosystem around the DNS 5.3.4 – Development and Public Responsibility New Program Development Description: FY17 new program development for Development and Public Responsibility efforts overseen by DPRD team to address identified gaps in broadening and supporting the multistakeholder model along focus areas. This includes pilot projects as requested and identified by ICANN stakeholders such as the Stakeholder Onboarding Mentors Program pilot and a pilot exploring the topic of gender diversity at ICANN


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5.3.1 Development and Public Responsibility Tools 1.7 0.3 0.0 0.1 0.0 0.0 0.4

5.3.2 Development and Public Responsibility Programs 3.5 0.5 0.3 0.2 0.0 0.0 1.1

5.3.3 Development and Public Responsibility Collaborations 1.8 0.3 0.3 0.5 0.2 0.0 1.4

5.3.4 Development and Public Responsibility New Program Development 1.1 0.2 0.5 0.0 0.0 0.0 0.7

Total 8.0 $1.3 $1.1 $0.9 $0.3 $0.0 $3.6


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Appendix A – FY17 Budget by Project The document listed below is linked from the ICANN’s financial web pages. It includes the detail of the costs by category as well as full-time equivalent number of allocated staff to each project. The file is provided in both PDF and Excel format. FY17 Budget by Portfolio and Project

https://www.icann.org/resources/pages/governance/financials-en


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B – FY17 IANA Operations by Activity The IANA department performs 13 major activities related to the operations for the Names, Numbers and Protocol Parameters client groups. The IANA personnel and resources are shared across the activities by operational communities with several positions supporting multiple communities. This approach to sharing resources is very efficient. The FY17 budgeted headcount for the IANA department is 16 positions. The FY17 budget for IANA/PTI costs by operational communities was developed by analyzing the time spent by each position on each of the 13 activities. All other departmental expenses and shared resources were also mapped to these 13 activities. These 13 activities were then mapped to the three operational communities.

IANA Activity Description & Methodology

Stakeholder Reports

Names Community Stakeholder Reports: Create the following reports: • Monthly DNSSEC report – this is a report to NTIA and is marked confidential • Monthly Root Zone Processing Time report – this is a report to NTIA and is published on ICANN’s IANA website • Monthly Root Zone Audit report – this is a report to NTIA and is published on ICANN’s IANA website • Monthly Performance Standards Metric report – this is a report to NTIA and is published on ICANN’s IANA website. It includes

metrics for the names and numbers functions • Periodic reports on delegation and transfers of Top Level Domains published on ICANN’s IANA website • C.4.2 Monthly Performance Progress Report – this is a report to NTIA and is marked confidential. The report includes metrics

for the names and numbers functions

Numbers Community Stakeholder Reports: • Create monthly Performance Standards Metric report – this is a report to NTIA and is published on ICANN’s IANA website. The

report includes metrics for the names and numbers functions. • C.4.2 Monthly Performance Progress Report – this is a report to NTIA and is marked confidential. The report includes metrics

for the names and numbers functions

Protocol Parameters Customer Reports: Create the following reports: • Monthly IETF SLA report • Status of IETF Internet Draft Daily report – automated report posted on IANA website • Monthly reports to the IAB about IANA activities • Monthly Expiration of Early Allocations Report to the IESG


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Request Handling Names Community Request Handling: • Handle requests from the Name Community • Write reports for the Board and NTIA related to TLD change of control (for example, delegations) • Establish new processes and procedures for introducing new services such as EBERO • Handle root zone and names issues and address technical or policy clarifications needed in order to handle a request • Manage escalations for unresolved issues • Compliance with applicable laws (for example, Office of Foreign Assets Control) Numbers Community Request Handling: • Handle requests from the Numbers Community • Manage escalations for unresolved issues • Compliance with applicable laws (for example, Office of Foreign Assets Control) Protocol Parameters Request Handling: • Handle requests from the Protocol Parameters Community including new registrations, modifications to existing registrations

and the removal of existing registrations • Introduce new processes and procedures for handling requests • Define new processes and procedures for creating new protocol parameter registries as per the IANA Considerations of an RFC • Manage escalations for unresolved issues • Compliance with applicable laws (for example, Office of Foreign Assets Control)

Stakeholder Engagement

Names Community Stakeholder Engagement: • Preparation, planning and attendance for three ICANN and three regional TLD meetings, and one Registrar & Registry meeting • Includes drafting, renewing and finalizing annual SLA • Drafting and reviewing documents for Public Comments Numbers Community Stakeholder Engagement: • Preparation, planning and attendance for 10 RIR meetings and 12 ASO (Address Supporting Organization) teleconferences • Includes drafting, renewing and finalizing annual SLAs, and reviewing policy documents adopted by the RIRs Protocol Parameters Community Stakeholder Engagement: • Attendance for three IETF meetings and periodic teleconferences with IPROC • Includes drafting, renewing and finalizing annual Service Level Agreements • Participation in twice-monthly IESG teleconferences and monthly IAB business meetings. Formal review of Internet-Drafts

during IETF Last Call, IESG Evaluation, Document Approval and Final publication

https://www.icann.org/resources/pages/ebero-2013-04-02-en

https://www.treasury.gov/about/organizational-structure/offices/Pages/Office-of-Foreign-Assets-Control.aspx

https://www.rfc-editor.org/info/rfc5226

https://www.rfc-editor.org/history/

https://www.ietf.org/iana/iproc.html

https://www.ietf.org/iesg/

https://www.ietf.org/id-info/


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• Contract with expert for technical review of Internet-Drafts

Internal Reports Names, Numbers and Protocol Parameters Community Internal Reports: • Conduct annual EFQM assessments to identify strengths and implement improvements to processes, services, people,

leadership and customer results across all three functions • Development of KPI dashboards • Quarterly reports for the Board • Quarterly reports for Global Stakeholder Engagement • Reports for ICANN GDD Operations • Reports for internal staff meetings • Reports for the ICANN annual report • Materials for ICANN meetings

Systems/Tools Enhancements

Names, Numbers and Protocol Parameters Community Systems/Tools Enhancements: Perform the following across all three functions: • Develop dedicated systems/tools enhancements to improve performance of services provided by the IANA department • Develop tools required to implement new community mandated processes • Consult about enhancements for registry workflow • Architect and implement website improvements, and administer ICANN’s IANA website including oversight of contractors and

developers • Provide general management oversight for website tools and enhancements • Architect and implement system improvements for the registry workflow • Provide requirements and propose improvements to the registry workflow, as well as engage in User Acceptance testing • Provide general management oversight for system enhancements Includes software licenses and materials for ICANN’s IANA website development, outsourced development to implement projects (for example, RDAP) and transition related web development. Names Community Systems/Tools Enhancements: Outsourced development for tools to monitor uptime of systems and software to report on SLEs defined by CWG. Protocol Parameters Community Systems/Tools Enhancements: Provide website improvement criteria and requests specifically for protocol parameters. Includes outsourced development for XML format registries, development of reporting tools, and enhancements to XML format registries.

https://tools.ietf.org/html/rfc7482


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Dept. Management Responsibilities

Names, Numbers and Protocol Parameters Community Department Management Responsibilities: • Membership and participation in ICANN’s Technology and Operations Senior Management Teams, representing all three

functions • Represent IANA Functions Operator at I-Star meetings. I-Star is a loosely coordinated group including ICANN, the IETF, W3C,

regional ccTLD groups, the RIRs, and the Internet Society. • Management responsibilities related to post-transition bodies (for example, CSC) The VP of IANA Functions owns and manages FY17 budget for the 15 staff supporting all three functions: • Five senior staff with management responsibilities • Two Cryptographic Key Managers • Five IANA Specialists • One Audit Associate • One Project Manager/Technical Writer • One Sr. Administrative Assistant

Key Signing Ceremonies

Names Community Root Zone Key Signing Ceremonies: Four Root Zone Key Signing Key Ceremonies (both East and West Coast) each year, including ceremony preparation and post-ceremony processing of the logs, video, and ceremony notes, then posting of material on ICANN’s IANA website. Includes: • Consultation with ceremony participants in reviewing and revising ceremony scripts • Reviewing and revising DNSSEC policy documentation with the Policy Management Authority • Collaboration with Verisign, the Root Zone Maintainer, which manages Zone Signing Keys • Manage relationships with Trusted Community Representatives Numbers and Protocol Parameters functions do not apply

KMF Facility Management

Names KMF facilities: • Manage the Key Management Facilities (KMF) and the Root Zone Key Signing Ceremonies • Manage and oversee plans to maintain and upgrade the KMF facilities, including related travel • Capital expense includes furniture, computer equipment, audit camera replacement, signing software development and

service contracts for alarm system and the facilities Numbers and Protocol Parameters functions do not apply.

Customer Surveys Names, Numbers and Protocol Parameters Communities Customer Satisfaction Surveys: • Involves selecting, contracting, and overseeing the third-party vendor that administers and analyzes the annual survey, as

well as writing the final report which is posted on ICANN.ORG and IANA.ORG

https://www.iana.org/dnssec


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• The procurement office issues the RFP and reviews the responses for compliance to the criteria in the RFP and negotiates the best price for the contract

• There is only one RFP for the customer satisfaction survey since all the functions are surveyed by a single contractor and at the same time

Third-party Systems Audits

Names Community third-party System Audits: • Two staff members lead the selection, contracting and oversight of the third-party vendor. Staff reviews the status of internal

controls, and meets with control owners on a quarterly basis to ensure no changes have occurred to in-scope processes and systems. Staff also leads the internal review of the final report and assertion letter.

• The procurement office reviews the contract and negotiates the best price/terms with the vendor. The IT department as well as the HR, Security and Facilities departments are instrumental in providing evidence related to systems that are in-scope of the audits.

• Legal reviews the final audit reports and ICANN’s assertion and representation letters prior to signing by the President of GDD and submission to NTIA.

• Two ICANN Cryptographic Key Managers are instrumental in providing evidence related to systems that are in-scope of the audits.

• IANA department personnel are interviewed and tender evidence to the auditor in response to inquiries, perform visits to remote facilities to collect audit-related material, and perform audit-related reviews

Numbers Community third-party System Audits: Although the current controls for the SOC2 audit were not specifically designed to address the Numbers processes, the evidence provided to the vendor demonstrates that ICANN remains compliant with the Process Operations controls. The controls involve reviewing the monthly reports that are published on ICANN’s IANA website, as well as the list of documented processes for all of the IANA Functions. Protocol Parameters Community third-party System Audits: In addition to the above explanation under “Names Community third-party Systems Audit,” a third staff member is involved in establishing the controls for the audit of the protocol parameter systems. Two of the seven Process Operations controls are specifically related to the protocol parameters function.

Risk, Security, Continuity Plans

Names, Numbers and Protocol Parameters Community Risk/Security/Continuity Plans: Review and revise the department’s Continuity and Security Plans each year

Consultation to Policy Groups

Names Community Consultation to Policy Groups: Consulting with the policy department regarding ccNSO, gTLD, IDN and ISO-3166 updates, policy recommendations, implementations and reports Numbers Community Customer Consultation to Policy Groups:

https://www.iana.org/about/audits


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Consulting with the RIR CEOs or ASO regarding allocations of IP and AS numbers, and reviewing ASO teleconference minutes and confirming there are no new Global Policies to be implemented. Protocol Parameters Consultation to Policy Groups: Consulting with the IETF/IAB leadership regarding IANA Considerations and the resulting implementation implications of those RFCs, as well as the relationship between ICANN and the Protocol Parameters Community. Also consulting internally regarding implications of the IANA Considerations detailed in RFCs that impact how IANA services are delivered.

Organizational Meetings (Corporate & Departmental)

Names Organizational Meetings: Includes immigration activities and services as needed for volunteer Trusted Community Representatives and staff, as well as administration (support and facilities) costs for DNSSEC meetings including security, rent, Internet access, phone and registration costs Names, Numbers and Protocol Parameters Organizational Meetings: Training provided to Audit Associate and IANA Specialists across all three functions, as well as administration costs for team lunches, transportation, postage, home Internet connectivity, tuition reimbursement, training courses and recognition awards for staff members. Provide IANA cross-training across ICANN organization. Attend for semi-annual Senior Management Team (SMT) meetings. Contribute to weekly SMT Operations meetings. Represent IANA functions at weekly GDD meetings.

Below is breakdown of the direct costs of each of the above activities by category of expenses and by operational community.

https://www.icann.org/resources/pages/global-addressing-2012-02-25-en

https://www.iana.org/dnssec/tcrs


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IANA Budget Summary by ActivitiesIn Thousands, USD

ACTIVITIES BUDGET - DIRECT COSTS FTE NAMES NUMBERS PROTOCOLS TOTAL COSTSTotal Stakeholder Reports 1.0 $54.1 $28.1 $62.8 $145.0

Personnel 54.1 28.1 62.8 145.0T&M 0.0 0.0 0.0 0.0Professional Services 0.0 0.0 0.0 0.0Admin 0.0 0.0 0.0 0.0Capital 0.0 0.0 0.0 0.0

Total Request Handling 3.2 160.7 7.9 192.3 360.8Personnel 154.8 7.9 181.3 343.9T&M 0.9 0.0 0.0 0.9Professional Services 5.0 0.0 11.0 16.0Admin 0.0 0.0 0.0 0.0Capital 0.0 0.0 0.0 0.0

Total Stakeholder Engagement 1.4 122.5 116.9 228.4 467.8Personnel 88.3 59.6 161.6 309.5T&M 34.2 57.3 66.7 158.3Professional Services 0.0 0.0 0.0 0.0Admin 0.0 0.0 0.0 0.0Capital 0.0 0.0 0.0 0.0

Total Internal Reports 1.3 72.4 46.4 63.7 182.5Personnel 72.4 46.4 63.7 182.5T&M 0.0 0.0 0.0 0.0Professional Services 0.0 0.0 0.0 0.0Admin 0.0 0.0 0.0 0.0Capital 0.0 0.0 0.0 0.0

Total Systems/Tools Enhancements 1.2 94.5 76.5 106.4 277.5Personnel 69.8 67.6 82.5 219.9T&M 0.7 0.0 0.0 0.7Professional Services 23.3 8.3 23.3 55.0Admin 0.6 0.6 0.6 1.9Capital 0.0 0.0 0.0 0.0


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ACTIVITIES BUDGET - DIRECT COSTS FTE NAMES NUMBERS PROTOCOLS TOTAL COSTSTotal Dept Management Responsibilities 2.0 221.8 93.5 128.5 443.8


Total Key Signing Ceremonies 1.3 314.8 0.0 0.0 314.8Personnel 225.9 0.0 0.0 225.9T&M 8.9 0.0 0.0 8.9Professional Services 80.0 0.0 0.0 80.0Admin 0.0 0.0 0.0 0.0Capital 0.0 0.0 0.0 0.0

Total KMF Facility Management 1.3 368.2 0.0 0.0 368.2Personnel 256.7 0.0 0.0 256.7T&M 6.9 0.0 0.0 6.9Professional Services 4.0 0.0 0.0 4.0Admin 1.6 0.0 0.0 1.6Capital 99.0 0.0 0.0 99.0

Total Customer Surveys 0.1 15.6 14.0 25.1 54.8Personnel 7.2 5.6 16.7 29.5T&M 0.1 0.1 0.1 0.3Professional Services 8.3 8.3 8.3 25.0Admin 0.0 0.0 0.0 0.0Capital 0.0 0.0 0.0 0.0

Total 3rd Party Systems Audits 1.5 222.0 0.0 155.1 377.1Personnel 119.4 0.0 55.1 174.4T&M 2.6 0.0 0.0 2.6Professional Services 100.0 0.0 100.0 200.0Admin 0.0 0.0 0.0 0.0Capital 0.0 0.0 0.0 0.0


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ACTIVITIES BUDGET - DIRECT COSTS FTE NAMES NUMBERS PROTOCOLS TOTAL COSTSTotal Risk, Security, Continuity Plans 0.7 45.9 45.9 45.9 137.8


Total Consultation to Policy Groups 0.2 38.3 10.5 14.5 63.4Personnel 38.3 10.5 14.5 63.4T&M 0.0 0.0 0.0 0.0Professional Services 0.0 0.0 0.0 0.0Admin 0.0 0.0 0.0 0.0Capital 0.0 0.0 0.0 0.0

Total Organizational Meetings (Corp & Dept) 0.8 406.2 43.6 43.6 493.3Personnel 37.1 30.1 30.1 97.3T&M 27.8 4.3 4.3 36.4Professional Services 0.0 0.0 0.0 0.0Admin 341.2 9.2 9.2 359.6Capital 0.0 0.0 0.0 0.0

TOTAL BUDGET - DIRECT COSTS 16.0 $2,137.0 $483.4 $1,066.2 $3,686.7

TOTAL BUDGET BY EXPENSE BY OPERATIONAL COMMUNITIES NAMES NUMBERS PROTOCOLS TOTAL COSTSPersonnel $1,377.3 $380.8 $819.3 $2,577.4T&M 90.0 69.5 87.8 247.2Professional Services 227.3 23.3 149.3 400.0Admin 343.4 9.8 9.8 363.0Capital 99.0 0.0 0.0 99.0

TOTAL BUDGET - DIRECT COSTS $2,137.0 $483.4 $1,066.2 $3,686.7


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C – Registrar Fees The Registrar fees are to be approved by the Board before submission to voting by the Registrars. Approximately 2,124 registrars are currently accredited by ICANN. This relationship is governed by the Registrar Accreditation Agreement (RAA), of which the most recent version was approved in June 2013. The two versions of the agreement currently in use were approved in 2009 and 2013. The RAA is a five-year agreement that provides for the following types of fees: Application fees Annual accreditation fees Variable accreditation fees Per registrar variable fees Transaction based fees In addition, since 2009, the budget has assumed an Add Grace Period (AGP) excess deletion fee to eliminate domain tasting. The amount for AGP deletion fees was assumed to be zero in past budgets and is also assumed to be zero for the FY17 budget. Application fees are paid one time by prospective registrars at the time of application. For FY17, the application fees are estimated to be $140,000 based upon a volume of 40 applications and a per application fee of $3,500 per application. Annual accreditation fees are fees that all registrars are required to pay annually to maintain accreditation. The fee is $4,000 per year. Registrars have the option of paying the annual $4,000 accreditation fee in quarterly installments of $1,000. For FY17, the annual accreditation fees are estimated at $6.3 million, based on an average of 2,000 registrars renewing and being newly accredited. Variable accreditation fees are determined based on the transaction type and volume of each registrar. There are two types of fees associated with the variable accreditation fees: Per registrar variable fee Transaction based fee Per registrar variable fees are based on a validated concept that ICANN often expends the same quantum of effort in providing services to a registrar regardless of size. However, provided that the registrar is considerably smaller in size and in activity, some registrars will continue to be eligible for “forgiveness” of two-thirds of the standard per-registrar variable fee. To be eligible for forgiveness, the registrar must have: (1) less than 350,000 gTLD


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names under its management; and (2) no more than 200 attempted adds per successful net add in any TLD. Forgiveness will be granted each quarter to all registrars that qualify. The amount per registrar is calculated each quarter by dividing $950 thousand (one-fourth of $3.8 million) equally among all registrars that have at least been accredited for one full quarter or have made at least one transaction, taking into consideration the forgiveness factor. In addition, a discount of 10 percent is granted to all registrars operating under the 2009 and 2013 RAA. Transaction based fees are assessed on each annual increment of an add, renew or a transfer transaction that has survived a related add or auto-renew grace period. This fee will be billed at $0.18 per transaction for registrars operating under the 2009 or 2013 RAA (resulting from a $0.20 base fee, discounted by 10 percent to $0.18). Add-grace period excess deletion fees are assessed on each domain name deleted, in excess of the threshold, during an add-grace period. The threshold is the larger of 50 or 10 percent of total adds, per month, per TLD. The rate per excess deletion is $0.20. Below is a summary of the estimated Registrar fees for FY17 by fee type.

Hig h L ow

Existing TLDsApplication Fees 0.1 2.6 (2.5) -95% 0.1 0.1 Accreditation Fees 6.3 8.8 (2.4) -28% 10.0 2.8 Per-Registrar Variable Fee 3.4 3.4 - 0% 3.4 3.4 Transaction Fees 34.6 31.1 3.5 11% 35.0 33.9 Total Registrar Revenue $44.5 $46.0 ($1.4) -3% $48.6 $40.3

In Millions, USD FY17 Best Estimate

FY16 Forecast

+ Incr./ - Decr. %

F Y 17 E s timates

I C A N N | Five-Year Operating Plan First Annual Update | Draft for Public Comment March 2016 82

Headquarters Los Angeles, CA, USA 12025 Waterfront Drive Suite 300 Los Angeles, CA 90094-2536 USA Phone: +1 310 301 5800 Fax: +1 310 823 8649 Hub Offices Istanbul, Turkey Hakki Yeten Cad. Selenium Plaza No:10/C K:10 34349 Fulya, Besiktas, Istanbul Turkey Phone: +90 212 999 6222 Singapore South Beach Tower 38 Beach Road Unit 04-11 Singapore 189767 Phone: +65 6816 1288 Fax: +65 6822 6212

Engagement Offices Beijing, China For Global Support Inquiry Contact: +86 10 5904 5561 Brussels, Belgium 6 Rond Point Schuman Bt. 1 Brussels B-1040 Belgium Phone: +32 2 894 7400 Geneva, Switzerland Regus Center Rue du Rhone 14 1204 Geneva Switzerland Phone: +41 22 819 1844 Fax: +41 22 819 1900

Montevideo, Uruguay La Casa de Internet de Latinoamérica y el Caribe Rambla República de México 6125 Montevideo, 11400 Uruguay Phone: +598 2604 2222 ext 5701 Fax: +598 2604 2222 ext 4112 Seoul, Korea 17F IT Venture Tower West Wing 135, Jungdae-ro, Songpa-gu, Seoul, 138-950 Korea, Republic of Phone: +82 2 405 6592 Fax: +82 2 405 6593 Washington, D.C., USA 801 17th Street, NW, Suite 400 Washington, DC 20006 USA Phone: +1 202 570 7240 Fax: +1 202 789 0104

fy17 operating plan and budget - icann · 2 – planning and budget overview 9 3 – icann...

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